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An inverted U-shape relationship between economic growth and financial development: a study from FY20 countries

Pratiwi Dwi Suhartanti et al.

International Journal of Sustainable Economy2025https://doi.org/10.1504/ijse.2025.147206article
ABDC C
Weight
0.50

What the paper says

This study investigates the relationship between financial development and economic growth. Using the sample data of 85 countries, including 53 developed and 32 developing countries, we find results consistent with previous findings that financial development positively impacts economic growth up to a certain threshold. However, when we extend the analysis into developed-developing countries and four different income-level countries, we find that the thresholds tend to be lower for developing and low-income countries. Further investigations show that institutional quality affects the impact. The threshold is lower in countries with low institutional quality. We interpret that the countries with low institutional quality have less capability to contain the negative effect of the financial market, lowering the threshold. Thus, controlling the negative impact of the financial market is an important aspect of the relationship between financial development and economic growth.

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https://doi.org/https://doi.org/10.1504/ijse.2025.147206

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@article{pratiwi2025,
  title        = {{An inverted U-shape relationship between economic growth and financial development: a study from FY20 countries}},
  author       = {Pratiwi Dwi Suhartanti et al.},
  journal      = {International Journal of Sustainable Economy},
  year         = {2025},
  doi          = {https://doi.org/https://doi.org/10.1504/ijse.2025.147206},
}

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An inverted U-shape relationship between economic growth and financial development: a study from FY20 countries

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Evidence weight

0.50

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.50 × 0.4 = 0.20
M · momentum0.50 × 0.15 = 0.07
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.